Posts tagged ‘benchmarks’

Why is the benchmark value of Oman crude oil sometimes spectacularly different when assessed by S&P Global Platts, compared to the value established for the very same crude oil through trading on the Dubai Mercantile Exchange?

In 2018, it is an important question because the answer shines a bright spotlight on how different the DNA can be for different price benchmarks representing the same market, which ultimately can have huge value implications.

The commoditization of the global LNG market has had implications across several associated industries, ranging from the gas-fired power sector to seaborne gas transportation.

Hence, it came as no surprise that the venerable Baltic Exchange, probably the world’s oldest source of shipping information, set out to build an LNG freight index in January that could be launched as early as spring 2018.

Platts JKM, the benchmark LNG spot price, has revealed three important surprises over the past three years.

In 2015, most analysts expected the LNG market to weaken considerably, increasingly de-correlate from oil and reduce seasonality.

Three years of JKM analysis counters all three expectations — as well as re-emphasizing the importance of market-based LNG pricing, and derivatives — in helping market participants flexibly react to unforeseen developments.

The Barrel blog turned 10 years old on April 2, and to celebrate, we’re sharing special posts throughout the month. As a part of the celebrations, Joe Innace looks at two heavyweights of the commodities world — oil and steel benchmarks.

What better time to pit the pricing performances of oil and steel against each other than during the 10-year anniversary celebration of The Barrel?